Semiconductor giant TSMC is expected to stop supplying chips made with

Semiconductor giant TSMC is expected to stop supplying chips made with
7 nm or smaller processes to customers in China that are developing AI
processors or GPUs. The move is reportedly to ensure it remains
compliant with US export restrictions.

The Taiwan-based megacorp, the largest semiconductor contract
manufacturer worldwide, is said to have notified AI/GPU chip companies
in China that it will halt shipments to them of 7 nm and more advanced
silicon, starting from November 11.

This follows events last month when TSMC reportedly tipped off US
officials that a Chinese customer appeared to be [1]trying to
circumvent export controls against China-based tech firm Huawei by
placing orders for a chip resembling Huawei's Ascend 910B GPU.

It was later claimed that the biz halted all shipments to the customer
in question, [2]alleged to be chip designer Sophgo, although the latter
denied the claims.

Now TSMC is suspending production of advanced silicon for Chinese
clients developing products aimed at high-performance computing, GPUs,
and AI-related applications, as reported by [3]Nikkei Asia and
Taiwan-based industry watcher TrendForce, which cites Chinese-language
media outlet [4]ijiwei.

This will not affect Chinese customers wanting 7 nm chips from TSMC for
other applications such as mobile and communications, according to
Nikkei, which said the overall impact on the chipmaker's revenue is
likely to be minimal.

TrendForce further cites another China-based source who claims the move
was at the behest of the US Department of Commerce, which informed TSMC
that any such shipments should not proceed unless approved and licensed
by its BIS (Bureau of Industry and Security). We asked the agency for
confirmation.
* [5]TSMC prioritizing high-NA EUV scanners for R&D
* [6]OpenAI reportedly asks Broadcom for help with custom inferencing
silicon
* [7]TSMC reportedly cuts off RISC-V chip designer linked to Huawei
accelerators
* [8]TSMC blows whistle on potential sanctions-busting shenanigans
from Huawei

Any moves by the silicon supremo is likely to be out of caution to
pre-empt accusations from Washington that it isn't doing enough to
prevent advanced technology from getting into the hands of Chinese
entities that have been sanctioned.

As TrendForce notes, it "highlights the foundry giant's delicate
position in the global semiconductor supply chain amid the heating chip
war between the world's two superpowers."

For example, TSMC was awarded billions under the US CHIPS and Science
Act toward building fabrication plants in the state of Arizona, an
arrangement that [9]may be reviewed under the Trump administration, it
was suggested earlier this week.

TSMC neither confirms nor denies the reports. A spokesperson told us:
"TSMC does not comment on market rumor ... TSMC is a law-abiding
company and we are committed to complying with all applicable rules and
regulations, including applicable export controls."

The semiconductor maker recently reported [10]a strong third quarter
2024 with revenue of $23.50 billion, an increase of 36 percent over the
same period last year, with chip output from its most advanced process
nodes – 3 nm and 5 nm – now accounting for more than half of that. ®

References

1. https://www.theregister.com/2024/10/22/tsmc_huawei_sanctions_report/
2. https://www.theregister.com/2024/10/28/tsmc_sophgo_huawei/
3. https://asia.nikkei.com/Business/Technology/TSMC-to-suspend-production-for-some-Chinese-AI-chip-customers
4. https://jiweipreview.laoyaoba.com/n/922301
5. https://www.theregister.com/2024/11/07/tsmc_highna_euv/
6. https://www.theregister.com/2024/10/30/openai_broadcom_tsmc_custom_silicon/
7. https://www.theregister.com/2024/10/28/tsmc_sophgo_huawei/
8. https://www.theregister.com/2024/10/22/tsmc_huawei_sanctions_report/
9. https://www.theregister.com/2024/11/04/chips_act_repeal/
10. https://www.theregister.com/2024/10/17/tsmc_q3_2024/